The Realities of Stewardship for Institutional Owners, Activist Investors and Proxy Advisors
Tuesday, 3 December 2013
Securities and Exchange Commission
Washington DC

A free all-day conference under the auspices of the Securities and Exchange Commission (SEC) and the European Commission, organised by the European Corporate Governance Institute and the Columbia Law School. With Lithuania holding the Presidency of the Council of the European Union, the organisers are most grateful for the support of the Lithuanian Embassy in Washington and for sponsorship of the 2013 conference by PricewaterhouseCoopers (PwC).

Program | Presentations and speeches | Video recordings | Disclaimer | List of attendees | Background reading | Background to the Dialogue

Program
In the U.S. and the U.K., diffuse public ownership has reconcentrated itself into the hands of institutional investors. Despite the controlling owner pattern that is generally associated with Europe, the sheer size of the largest companies has meant that institutional investors are, collectively, the dominant shareholders in many of the most important firms. Does such institutional ownership require a particular engagement with the governance of portfolio companies, what some have called 'stewardship'? What would 'stewardship' entail? How would 'stewardship' change the business model of the institutional investors? This year's Transatlantic Corporate Governance Dialogue asks whether activist shareholders and proxy advisors retard or advance an appropriate conception of stewardship. It then takes up an alternative strategy to governance reform, legislation that empowers shareholders, as exemplified by the spread of 'Say on Pay.'

8.30-9.00am Registration and coffee
9.00-9.15am
Conference Chair
Professor Ronald Gilson
Marc & Eva Stern Professor of Law and Business, Columbia Law School
Charles J. Meyers Professor of Law and Business, Stanford Law School
and ECGI Research Member
Professor Ronald Gilson, Marc & Eva Stern Professor of Law and Business, Columbia Law School, Charles J. Meyers Professor of Law and Business, Stanford Law School
Welcome
Jörgen Holmquist
Chairman
European Corporate Governance Institute
Jorgen Holmquist, Chairman of the ECGI
Remarks from the EU Presidency
Minister Counselor Simonas Šatūnas
Deputy Chief of Mission

Embassy of the Republic of Lithuania


Session 1 - Opening remarks

9.15-9.35am Mary Jo White
Chair
U.S. Securities and Exchange Commission

Introduced by Jörgen Holmquist
Mary Jo White, Chairman, Securities and Exchange Commission

Session 2 - Activist Shareholders and Shareholder Value: Long Term v. Short Term
Activist shareholders aggressively seeking major strategic changes at even the largest firms have become increasingly important corporate governance players. Debate rages over whether such activity creates long-term sustainable value at the targeted firms, or whether the gains are short-lived and the damage perhaps permanent. A related, more difficult question, is the impact of such activity on corporate decision-making by non-targeted firms.

9.35-11.25am
Moderator
Professor Ronald Gilson
Marc & Eva Stern Professor of Law and Business, Columbia Law School
Charles J. Meyers Professor of Law and Business, Stanford Law School
and ECGI Research Member
Professor Ronald Gilson, Marc & Eva Stern Professor of Law and Business, Columbia Law School, Charles J. Meyers Professor of Law and Business, Stanford Law School
Briefings
Professor Wei Jiang
Arthur F. Burns Professor of Free and Competitive Enterprise
Columbia Business School
Professor David Larcker
James Irvin Miller Professor of Accounting
Graduate School of Business, Stanford University
Panel
Mats Isaksson
Head of Corporate Affairs
Organisation for Economic Co-operation and Development (OECD)
Justice Jack B. Jacobs
Justice of the Delaware Supreme Court
11.25-11.40am Coffee and tea

Session 3 - The European perspective

11.40-12.15pm Ugo Bassi
Director for Capital and Companies
DG Internal Market and Services
European Commission


Introduction and Q&A moderator
Professor Jeffrey Gordon
Richard Paul Richman Professor of Law, Columbia Law School and
Co-Director, Millstein Center for Global Markets and Corporate Ownership
and ECGI Research Member
12.15pm Lunch (Lunch will not be provided)

Session 4 - SEC Commissioner's remarks

1.30-2.00pm Daniel Gallagher
Commissioner
U.S. Securities and Exchange Commission

Introduced and Q&A moderated by Professor Jeffrey Gordon

Session 5 - Proxy Advisors: Do they wield too much influence? Whether and how to regulate - the lessons from Europe
The role of proxy advisors has been hotly contested.  In Europe, ESMA has just recommended an EU Code of Conduct for the industry. How much influence do they wield, either through changing vote outcomes on governance-related matters or setting the governance agenda? How much influence do they wield on contested control-related matters, such proxy contests by activist shareholders or acquisition proposals? Does the small number of influential advisors raise particular concerns? Is regulation appropriate and if so, of what type?

2.00-4.00pm
Moderator
Ira M. Millstein
Senior partner, Weil, Gotshal & Manges
Chair, Millstein Center for Global Markets and Corporate Ownership
Columbia Law School
Briefings
Laurent Degabriel
Head of Investment and Reporting Division
European Securities and Markets Authority (ESMA)
Professor Jill Fisch
Perry Golkin Professor of Law, Co-Director, Institute for Law and Economics
University of Pennsylvania Law School
and ECGI Research Member
Dr Tao Li
Assistant Professor
University of Warwick
Panel
Gary Retelny
President
Institutional Shareholder Services Inc
Michelle Edkins
Managing Director
Global Head of Corporate Governance and Responsible Investment
BlackRock
4.00-4.15pm Coffee and tea

Session 6 - Say on Pay: Is it working? How far should it go?
Advisory shareholder votes on executive compensation was a UK invention but it has spread throughout the EU and the US. Has it been effective at curbing the level of executive compensation or improving the form in which it is provided? Should shareholders and governments move to give shareholders mandatory approval rights on executive compensation?

4.15-5.45pm
Moderator
Professor Randall Thomas
John S. Beasley Professor of Law and Business
Vanderbilt University Law School and Owen School of Management
and ECGI Research Member
Briefing
Professor Fabrizio Ferri
Associate Professor
Columbia Business School
Panel
Donna Dabney
Executive Director, Governance Center
The Conference Board
Francesco Chiappetta
General Counsel and Head of General and Institutional Affairs, Pirelli & C. S.p.A.
Member of the Advisory Group on Corporate Governance and Company Law, European Commission
Katherine Rabin
Chief Executive Officer
Glass Lewis & Co

Session 7 - Summing up, Assessment and the Way Ahead

5.45-6.00pm Professor Marco Becht
Professor of Finance and Economics, Université Libre de Bruxelles
ECGI Executive Director
and ECGI Research Member
Professor Marco Becht, Professor of Finance and Economics, Université Libre de Bruxelles, ECGI Executive Director
Professor Jeffrey Gordon
Richard Paul Richman Professor of Law, Columbia Law School and
Co-Director, Millstein Center for Global Markets and Corporate Ownership
and ECGI Research Member
Geoffrey Aronow
Chief Counsel and Senior Policy Advisor, Office of International Affairs
U.S. Securities and Exchange Commission